Implement Blue Ocean Strategy for Your Businessadmin
Nowadays business competition is getting tougher, so business people must be able to look for innovative and creative marketing ideas and strategies. With a creative strategy, creative business opportunities will open. As a business person, you need to apply innovations that are not thought of by your business competitors. Although innovations are created outside of your comfort zone. One of the strategies carried out by business people is Blue Ocean Strategy.
Get to know the Blue Ocean Strategy
The Blue Ocean Strategy was first coined by W. Chan Kim and Renee Mauborgne. Blue Ocean Strategy is a strategy that emphasizes companies not to win the competition by conducting a head to head strategy with competitors. In other words, the Blue Ocean Strategy is a strategy to release you from the condition of the Red Ocean. Red Ocean conditions are conditions where there is intense competition to get the same market as competitors. This makes it possible for competition with competitors to become very tight and knock each other down. Meanwhile, on the Blue Ocean strategy, there is almost no competition, because from the start the business was started already daring to be different from competitors. Because it is different from competitors, the market that is interested in your product is a special segment. This will create higher demand.
It is not easy to implement the Blue Ocean Strategy because creativity and intelligence are needed in seeing the market. It also requires a substantial cost in implementing it. So as a business person, you have to calculate your business finances well. Behind this strategy, there are company activities namely promotion, education, and others that are carried out independently without any support from interested parties.
Difference between Blue Ocean and Red Ocean
|Blue Ocean||Red Ocean|
|Making competition irrelevant||Fighting competition|
|Creating a market where there are no competitors||Compete in an existing market|
|Break the exchange of value costs||Choose between value costs ( value cost trade-off )|
|Integrate the overall system of company activities in pursuit of differentiation and low costs||Integrate the company’s overall system of activities with a strategic choice between differentiation or low cost|
|Create and accept new requests||Exploit existing requests|
4 Blue Ocean Strategy Actions
To face competition by implementing this strategy, there are at least 4 actions that must be taken by business people.
a. Eliminate (delete)
In business, there will always be things that are actually considered good but not useful to the community. So, you should eliminate or eliminate things that are not valuable from the product. This is done so that the product is able to maximize the features and parts available. In that case, you don’t need to feel lost or feel something is missing if you eliminate the product. You just have to be able to accentuate the character of the main products that are excellent for your business.
b. Reduce (Reduce)
Different from elimination, reducing here is by reducing the element whose value is less but still needed. If you don’t want to completely eliminate useless features, at least you can reduce them below industry standards. That way, spending will be more efficient. However, if the feature does not contribute as much as a value to the community, it should be removed. Thus, the business will be more targeted while generating better profits.
c. Raise (Increase)
If you have reduced features that do not provide benefits, then you need to increase standards and features that have advantages. This will be an opportunity for you to make a differentiator from competing products.
The action you have to do is create new things that have never been done and done by a new industry. This will create new breakthroughs that can captivate the hearts of consumers. You must create features that are proven capable of providing more value and benefits to consumers. Because the existence of this will make your business accepted by the wider community.
Strengths and Weaknesses of Blue Ocean Strategy
- Advantages of Blue Ocean Strategy
- Get out of the crowded “game” and create a new “toy” or market
- Opportunities to get big profits in new markets
- A new brand that is created for the first time and is successful will stick in the hearts of customers
Lack of Blue Ocean Strategy
- Requires considerable investment and costs
- The customer base has not yet been formed
- Requires education to customers to avoid misunderstandings about the product being sold.
Tips for Implementing the Blue Ocean Strategy
Here are some tips for you on how to implement the blue ocean strategy to overcome competition.
Tip 1: Focus on niche markets
You need to create a new market niche that competitors never thought of. For example, by raising your hobby into a potential opportunity. For example, if you have an automotive hobby and have a cafe business, you can present unique concepts, such as an old car collection. This can be a special attraction for consumers. Could be, without you doing a promotion, your cafe is crowded, because it presents a unique concept, and become the talk of many people.
Tip 2: Create Innovation
By implementing the blue ocean strategy, you are required to create an innovative product. Products that are unique will have added value that other competitors do not have. For example, Lemonila products that promote the idea of instant noodle products that are safe to eat every day.
Tip 3: Unique Slogan
The slogan here is not just a tagline on an ad but has a long-term goal. Which of these things can create an impression in the hearts of customers and is firmly entrenched in the minds of consumers? This strategy is carried out in order to strengthen a brand.
Objectives of Learning the Blue Ocean Strategy
Know the Market
Before you enter the market, you need to know what kind of market you are entering. This relates to market research, marketing strategies, types of competition, to how to win the hearts of consumers
Achieve Target and Market Segmentation
If you sell a product without knowing where it should be sold. Then, there will be a lot of stockpiled up in the warehouse. It could be, a lot of stock circulating in the market but the sales and profits are stagnant at one point. However, if you know the right target and segmentation, then you will know to whom your product will be sold.
Knowing the Chances of Success & Failure
You will find out how likely you are to succeed and fail at the marketing strategy you choose.
Become a Market Leader
Starting from meeting the solutions to consumer needs, you can lead the market compared to competitors. Business owners are careful in capturing what consumers need and can provide solutions to overcome these problems.
Those are the things to watch out for if you are interested in starting a Blue Ocean Strategy for your business. Meanwhile, if your strategy is considered good enough, then your business also needs to manage finances well. Even though you are not an expert in accounting, you don’t need to worry about managing business finances. With the Journal there are features that will help you in preparing financial statements, income statements, cash flow, and others.